Business Environment: Types of Organizations, Legal Structures, UK Competition Policy, and Globalization

This report discusses diversified aspects of types of organization, legal structures, difference between community and private ownership along with assessment of the UK Rivalry strategy and the legislative framework. Apart from this, the study will also discuss the concept of market competition, microeconomic objectives and complete understanding about the globalization.

BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
a) Overview of different types of organizations.........................................................................1
b) Different legal structures along with their advantages and disadvantages.............................2
c) Difference between private and public ownership and ways of financing them....................3
d) UK competition policy and legislative framework surrounding anti competition practices. .3
e) The ways through which competition and market authority operates to review business
practices and impact over consumers..........................................................................................4
f) Understanding of the objectives and fiscal and monetary policy instruments government use
to regulate economy and their impacts........................................................................................5
g) Understanding about globalisation and the ways in which it affects business, competition
and the economy.........................................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Business environment refers to certain factors that greatly affects any organizations into
their operations and involves various consumers, competitors, stakeholders, etc. It is basically a
combination of the internal as well as external factors that influence the business aspects (Rialp-
Criado and Komochkova, 2017). This report will discuss diversified aspects of types of
organization, legal structures, difference between community and private ownership along with
assessment of the UK Rivalry strategy and the legislative framework. Apart from this, the study
will also discuss the concept of market competition, microeconomic objectives and complete
understanding about the globalization.
MAIN BODY
a) Overview of different types of organizations
Types of
organizations
Private Public Charity
Company name Marshall Group AstraZeneca Plc. British red cross
society
Aim Their major aim is to
maximise profits and
income level for
varied shareholders to
receive good return
over their
investments.
The primary aim of
public limited
companies is to
maximise
shareholders value,
increase brand
awareness, generates
customer’s loyalty
and more.
These firms are
generated in order to
relieve society from
various social issues
such as poverty,
culture, heritage,
science and always
work for the benefits
of the public living in
the society (Shelton
and Shopley, 2017).
Structure They are basically
sole proprietorship,
limited ability,
corporations and
It is a kind of separate
legal entity with
minimum 3 directors
and 7 shareholders
Non-profit
organizations that
raises support for the
society. Their
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partnership firms. (Dang, Jasovska and
Rammal, 2020).
structure includes
supremacy
instruments to make
sure that money raised
supports the mandated
purpose.
Financing Currency from
individual savings,
friends and family,
bank loans, private
entities and venture
capital
Sale of their securities
and public financing
Through donations
b) Different legal structures along with their advantages and disadvantages
There are four most common types of legal structures such as:
 Sole proprietorship: It is kind of commercial object that has been run by an individual
and there are no lawful differences among the owner and the business. It is the most
common procedure of legal construction for small businesses. Pros of this kind of
structure are easy and honestly inexpensive to found and owner has full regulator over
the commerce. On the other hand certain cons include owner has unlimited exposure of
risk and investors would not invest in the businesses.
 General partnership: It is an connotation among two or more persons seeking for
income. It has been created with slight formalities and agreement among them is greatly
required. Advantages involve easy creating and incomes and sufferers are passed through
to the owners personal tax returns (Decock and Spiessens, 2017). On the other hand,
disadvantages includes associates are individually liable for business obligation and can
lead to organisation and oversight challenges inattentive company agreement.
 Partial liability Company: It is a mixture among the corporation, sole proprietorship
and general partnership. Owners are called members which may include foreign entities.
Its advantages includes owners have limited liability as profits and wounded are passed
on to the members of the firm and allows unlimited number of members. However,
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certain disadvantages involves often subject to additional taxes as well as members
portion of revenue represents chargeable revenue even if the profit was not dispersed.
 Corporations: It is the most complex business structure that is separate and independent
from the people who own or run the business. Its advantages includes corporate
shareholders have limited liability and usually favours formation of investors. However,
disadvantages includes procedure that is more precise in nature, earnings are subject to
double taxation and involves high level of governance.
c) Difference between private and public ownership and ways of financing them
Public possession is refers to the administration provisions of properties and facilities
along with commercial and business activities of the state. It involves government owned
entities such as airways, railways, utilities, etc. The biggest benefit of such kind of ownership is
raising money and also good for society by providing funds to enable growing companies in
order to create new job opportunities and helps to improve the living standards along with
complete social conditions (Toma and Marinescu, 2018). The major sources of public ownership
are retained earnings, equity capital and debt capital. They utilise reserved salaries from business
operations to enlarge bonuses among stockholders. They raise funds from collecting debt from
banks or by going public.
On the other hand, private ownership are the firms who require individual entrepreneurs in
order to start any business. It involves family owned businesses and sole proprietors within the
society. the private owned companies do not have to answer to public investors. Their rights are
one of the major pillars of capitalist economies, along with various legal entities and moral
philosophies. They get their finance from their family and friends, bank loans, angel investors,
venture capitalist, crowdsourcing, etc.
d) UK competition policy and legislative framework surrounding anti competition practices
There are generally four types of market competition which are explained below:
 Perfect competition: It occurs when there is huge amount of minor businesses opposing
against each other. They trade alike merchandises, lack value inspiration over the
merchandises and are allowed to arrive or departure from the market space.
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 Monopolistic competition: It refers to an imperfect modest marketplace with characters
of both the domination and modest market. Venders contest amongst themselves and can
distinguish their properties in terms of excellence and marking to look dissimilar.
 Oligopoly: It consists of minor amount of great businesses that sell differentiate or
undistinguishable products. there are few players exists within the market space and their
inexpensive policies that are reliant on upon each other (Pucihar and et.al., 2019).
 Monopoly: In this structure, single company represents the whole industry. It has no
competitor and they are sole seller of the products in the entire market space.
In context of UK competition policy, it seeks out control performs that weaken or limit
rivalry to the determinant of patrons. This involves the misuse of competitive market position by
the firm, anti-competition agreements between the firms and mergers if allowed would result in
a substantial competition. On the other hand, the aim of EU competition policies is to protection
the correct operative of the single marketplace. It makes sure that the firms have the possibility
to compete over equal terms within the markets.
e) The ways through which competition and market authority operates to review business
practices and impact over consumers
CMA is defining as the competition regulator in the United Kingdom, it is considering as
the independent department along with the major responsibilities. Their concern is about to
investigate the market, mergers, or the competition in the market with the customer law
(Seetharaman, 2020). It is the government agency also known as the economic regulator, they
aim to protect the laws of the customer, also regulates the competition laws in the market.
The role of the Competition and authority market is to assess the market information as to
know the mergers that could prohibit the competition, their main purpose is to prevent the
organizations from exploiting the laws of the customers in the market. They restrict the
companies to use the tactics which can be inflated prices. It prevents the anti-competitive
practices in the market also reduce the competitive fair play factors from the market. Their
power involves the investigating the entire market sector, also to address the problem which is
arise for the customer who are the victim of the anti-competitive practice, in such they provide
the solution for the problem.
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CMA is beneficial for the customer as they address the issue of the consumer and aim to
resolve it in good aspect (Domazet, 2018). As they protect the right of the customer in the
market and protect them from becoming the victim of the anti-competitive practice. As it is
important for the businesses to attract the customer towards their services for good revenues, but
if they are using wrong tactics which are violating the consumer rights. In such consumer have
right to go for the CMA to resolve their issue or protect their rights.
f) Understanding of the objectives and fiscal and monetary policy instruments government use to
regulate economy and their impacts
Microeconomic policies purpose to offer a stable monetary atmosphere that is conductive
to promotion durable and supportable economic growth and expansion. The key columns of
micro economic procedure are monetary policy, fiscal policy and argument frequency policy
(Stverkova and Pohludka, 2018). Their objectives are to enhance the standards of living and
achieve stable economic growth. They support objectives such as minimising unemployment,
enhance productivity and control overall inflation.
Government influences the economy by changing the types of taxes and level along with
the composition of spending as well as degree and form of borrowing. Government in direct or
indirect manner influence the ways in which resources are utilised within the economy. In
context of impacts of government interventions, their impact over the balance of payments are
that it improves the country’s BOP as country may prohibit particular luxurious goods and
services such as cars and other luxury item from getting into the country (Hamad, Elbeltagi and
El‐Gohary, 2018). It helps to reduce the inequality and market failure which can take various
reforms. It prevents discrimination on all grounds. In context of taxation, it enhances the tax
within the society. Although it does not affect the demand curve nor make the supply and
demand curve more or less elastic in nature. On the other hand, in terms of exchange rates, it has
been identified that it reduces aggregate demand and hence inflation also has been reduced.
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g) Understanding about globalisation and the ways in which it affects business, competition and
the economy
Globalisation is the concept that has been used to illustrate the growing interdependence of
the world’s overall economy, population and culture, brought about by cross border businesses
in context of goods and services, investment flow and technology that has been utilised.
Globalisation greatly affects the economy as it enables the firms to specialize and enhance the
intensity of research and development, capital and innovation within the outcome. It made the
whole process easier for new entrants to start competing with old companies (Grizane and
Jurgelane, 2017). the trade sector has increased the number of people that they employ with the
help of imports and exports.
In terms of off-shoring production, it heightens the economy in other countries. However,
the economy in the own country will decreases. This is because of employees spend less caused
by reduces income.
CONCLUSION
From the above report it has been concluded that in order to doing business into the
environment, a lot of factors and things exists that are highly impact the overall functioning of
the business entity.
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REFERENCES
Books and Journals
Dang, Q.T., Jasovska, P. and Rammal, H.G., 2020. International business-government relations:
The risk management strategies of MNEs in emerging economies. Journal of World
Business, 55(1), p.101042.
Decock, S. and Spiessens, A., 2017. Customer complaints and disagreements in a multilingual
business environment. A discursive-pragmatic analysis. Intercultural pragmatics, 14(1),
pp.77-115.
Domazet, I., 2018. Digital transformation of business portfolio through DCRM. Digital
Transformation-New Challenges and Business Opportunities, pp.214-235.
Grizane, T. and Jurgelane, I., 2017. Social media impact on business evaluation. Procedia
Computer Science, 104, pp.190-196.
Hamad, H., Elbeltagi, I. and El‐Gohary, H., 2018. An empirical investigation of business‐to‐
business e‐commerce adoption and its impact on SMEs competitive advantage: The case
of Egyptian manufacturing SMEs. Strategic Change, 27(3), pp.209-229.
Pucihar, A., and et.al., 2019. Drivers and outcomes of business model innovation—Micro, small
and medium-sized enterprises perspective. Sustainability, 11(2), p.344.
Rialp-Criado, A. and Komochkova, K., 2017. Innovation strategy and export intensity of
Chinese SMEs: The moderating role of the home-country business environment. Asian
Business & Management, 16(3), pp.158-186.
Seetharaman, P., 2020. Business models shifts: Impact of Covid-19. International Journal of
Information Management, 54, p.102173.
Shelton, R.D. and Shopley, J.B., 2017. Beyond the green wall: Rethinking the environment for
business advantage. In Greening the Boardroom (pp. 119-128). Routledge.
Stverkova, H. and Pohludka, M., 2018. Business organisational structures of global companies:
Use of the territorial model to ensure long-term growth. Social Sciences, 7(6), p.98.
Toma, S.G. and Marinescu, P., 2018, May. Business excellence models: a comparison.
In Proceedings of the international conference on business excellence (Vol. 12, No. 1, pp.
966-974). Sciendo.
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